Alnylam, UMass, and Others Settle RNAi Patent Litigation

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[Updated 3/15/11, 2:28 pm ET. See note below] Litigation concerning key patents involved in the development gene-silencing drugs known as RNA-interference therapies has been settled. Cambridge, MA-based Alnylam Pharmaceuticals (NASDAQ:ALNY), a developer of RNAi therapies, said today that the firm and all others involved in the lawsuit over certain rights to the Tuschl I and Tuschl II families of patents have reached an agreement.

The litigation began in June 2009 and was set for trial this month in federal court in Boston. It involved several major players in the field of RNAi—which offers the promise of turning off disease-related genes to treat illnesses such as cancer—including Alnylam, Max Planck Society, the University of Massachusetts, and the Whitehead Institute for Biomedical Research. Now all those groups, including MIT, a former party to the litigation, have reached a deal that clarifies the rights to the key patents.

The groups have agreed to give Germany’s Max Planck, which has for years made Alnylam its exclusive licensee of the Tuschl II patent family, the lead role in coordinating the prosecution of the Tuschl I and Tuschl II family of patents in the U.S. Max Planck is also continuing this lead role in prosecuting the Tuschl II patents in markets outside the U.S. The University of Massachusetts will now lead prosecution of the Tuschl I patents outside of the U.S., and Alnylam has agreed to grant UMass permission to sublicense the U.S. Tuschl II patents to the U.S. drug giant Merck (NYSE:MRK) under certain limitations in return for a portion of sublicensing revenue, according to the firm’s press release.

“It’s good for Alnylam to have it out of the way,” Alan Carr, a biotech analyst for Needham & Company, said this morning. “I think that with Max Planck managing most of the patent prosecution, that is going to be a positive thing” for Alnylam.

Alnylam, which is at various stages of developing RNAi treatments for respiratory syncytial virus, liver cancers, and Huntington’s disease, has always regarded the Tuschl II patent family as important to its intellectual property position. The company, founded in 2002, has no products on the market and has brought in millions of dollars in revenue over the years from licensing and partnership deals with major drugmakers such as Novartis, Roche, and Takeda.

“Today’s settlement provides for a favorable resolution of this dispute for all parties and significantly optimizes the successful prosecution of both the Tuschl I and Tuschl II patent families, which together represent critical innovations for the advancement of RNAi therapeutics as breakthrough medicines,” said John Maraganore, CEO of Alnylam, in a statement.

Barry Greene, Alnylam’s chief operating officer, said in an interview this afternoon that the fact that the settlement gives Max Planck a lead role in prosecuting the U.S. Tuschl I and Tuschl II patent families is a win for Alnylam. “We’ve maintained all along that Alnylam intellectual property was required by all involved in the development and commercialization of RNAi therapeutics,” he said. “Today’s settlement further strengthens that belief.”

A patent is referred to a set of rights granted to an individual or business by the state that gives them public disclosure of a new invention for a specific amount of time. This grant does not actually give the holder the exclusive right to practice the invention, but simply the right to preclude other outside parties from using or imitating it. Patent Litigation is a controversy or disagreement between two independent parties regarding a dispute of intellectual or physical property.